Editor's note: This blog post is written by Alex Tolbert, founder of Bernard Health.
Our healthcare system is broken partly because consumers don't
know what anything costs. As patients become more proactive in making informed
healthcare decisions, we all agree this should be fixed. But why is it so hard?
Achieving price transparency in healthcare is difficult because healthcare
business models rely heavily on a lack of transparency.
Insurers, hospitals and providers want a better healthcare
system as much as anyone, but can't afford to inflict damage on their businesses
by making prices transparent overnight.
To better understand how transparency affects healthcare, let's
take a look at the business models for insurers and hospitals.
Insurer Business Model
If prices were completely transparent, then insurance companies
who had negotiated the lowest prices would begin to lose their primary
advantage. This is because that pricing information would give medical
providers and other insurance companies more power when negotiating and
competing with them.
An insurer's business model can be boiled down to this:
- Negotiate discounted prices with providers.
- Insure people, collect premiums.
- Pay claims to providers at discounted prices.
- Keep the difference.
Since that is the business, here is how you win financially:
- Negotiate the lowest prices with
- Offer the lowest premiums so you can attract
the most insured people.
- Enjoy the virtuous cycle that ensues.
What virtuous cycle?
The more people you insure, the lower the prices you can get
from providers. If you can get the lowest prices, you can offer the lowest
premiums. Offering the lowest premiums will win you the most insured people,
and so you can continue to negotiate the lowest prices from providers. And so
Hospital System Business
If prices were completely transparent, then it would be
difficult for the hospitals to justify the high prices they charge for things
available elsewhere for a fraction of the price. In other words, if everyone
knew that "Procedure ABC" costs $3,800 at the hospital and $600 for the same
quality at a standalone facility next door, the hospital would lose a lot of
The typical hospital system business model can be boiled down to
- Negotiate prices with insurers to be
- Get paid at those prices on patient claims
submitted to insurers.
- Pay your doctors, "midlevel" providers, nurses
and facility/equipment costs.
- Keep the difference.
Since this is the business, here is how you win financially:
- Negotiate the highest prices with insurers.
- See as many patients as possible.
- Submit as many claims as possible for each
It's a lot easier to do more tests/procedures per patient than
to attract more patients. As such, your contracted prices for tests and
procedures are really important.
Fortunately, as a hospital system, your size gives you leverage
when negotiating with insurers. The insurers need you in their network more
than they need a given imaging center. As a result, you're able to negotiate prices that are a lot higher and still be in-network.
Fueling the Movement Toward
Creating a better healthcare system starts with price
transparency. The growth of health savings accounts and transparency start-ups,
like Healthcare Blue Book and Change:Healthcare have fueled the movement toward
In addition, insurers and hospitals are working hard to provide
transparency. To offset the damage transparency will inflict on their business
models, they're working to develop other competitive advantages.
As consumers continue to share the burden of ever-increasing
healthcare costs, it's only fair that they be armed with the information needed
to make informed decisions about their healthcare. This transparency will lead
to a better-functioning and lower-cost system with happier providers and
Editor's note: This article was posted with permission from its author, Christine Gondos, Igloo Software. She can be reached at email@example.com.
The fastpaced healthcare industry is continuously evolving --
whether it be newly released studies, new best practices or new techniques, the
healthcare community thrives off of innovation.
annual conferences provide the opportunity for healthcare professionals to
connect, the majority of professionals rely on email to exchange new findings.
Healthcare professionals have recently placed an importance on social media
networks (such as Twitter) as an additional outlet to exchange ideas. While
social media provides an opportunity for medical professionals to connect and
discuss best practices, this ultimately becomes problematic due to the
confidential nature of the discussions.
how can healthcare professionals network, engage in conversations about practice and
share knowledge while maintaining confidentiality and ethical standards?
Software's Senior Vice President of Marketing & Operations, Andrew
recently presented at the CIO Healthcare Summit where he discussed "How
Healthcare Organizations are Moving from Social Media Marketing to
Business Strategy." Instead of connecting on public social networks,
more healthcare organizations are creating a social business strategy so
can collaborate on their own private network.
Secure enterprise social platform
organizations like Igloo
unite healthcare professionals, practitioners and
patients so they can collaborate on ideas and keep information in one
area. After a patient leaves the office, you no longer need to feel that
sense of ambiguity questioning if you remembered everything he or she
longer does a conversation need to live in the room you had it; nor your
inbox, nor your notebook.
Enterprise social software erases ambiguity and allows information to be
accessible yet secure. Here are four use cases of how enterprise
social software enables healthcare professionals to stay connected outside the office.
- Kimberly-Clark Clinical Solutions
is a health division of a large consumer goods company that has a very large
health product portfolio including medical devices & infection prevention.
To facilitate research, they launched a social extranet solution to act as a
product evaluation center for open innovation & customer engagement.
- Ontario Health Quality Council,
an independent provincial body for patient care, coordinates a myriad of
stakeholders in a member portal to report on the health system's effectiveness
and opportunities for process improvement.
Are your patients curious about learning more
information about what you said in a recent appointment? While you may question the
validity of checking Wikipedia or the intimidating results Google reports back,
patients often feel alone when they leave their provider's appointment.
Healthcare organizations realize this and have bridged the gap by offering
patients a portal where they can connect.
National Medical Center provides patients with a secure, private virtual
place where they can ask questions, find answers and share experiences around a
specific health condition. Their Emergency Medical Services for Children
Program (EMSC) National Resource Center also provides a secure portal for
grantees to interact and share information with each other in support of EMSC's
national child advocacy programs.
Want to bring together key stakeholders within a healthcare
association to work together and improve healthcare delivery? A
conference may be a great way to get everyone together, but how will you
Enterprise social software platforms provide practitioners a
specific work area where they can collaborate on documents and share best
Drug Information Association uses a social
extranet to connect their 18,000 members in the biopharmaceutical industry for
online learning, collaboration and managing their communities of practice.
Since adopting this new form of technology, their collaboration tools are now
streamlined and this area facilitates knowledge exchange and relationship
building in a private member portal for their 32 special interest groups.
American Academy of Family Physicians (AAFP),
representing more than 100,000 family
physicians and medical students nationwide, improved their collaboration since
launching an online community for peer networking, information sharing and
practice transformation. Members have access to online seminars, practice
tools and the "Ask An Expert" area. Known as Delta Exchange, the award-winning online
network connects physicians, clinical staff, office staff and primary
care-focused residency programs committed to the Patient Centered Medical Home.
wholly-owned subsidiary of the American Academy of Family Physicians (AAFP)
also capitalized on the benefits of social collaboration. In an effort to
improve patient care and assist primary care physicians with medical practice
redesign, over 500 practices and more than 5,000 medical professionals across
the country connect and collaborate using Igloo Software.
External facing communities (extranets) have gained
tremendous momentum for healthcare organizations. Effective collaboration,
improved knowledge sharing, and accessibility anywhere - it is no wonder that
more and more healthcare organizations like The College of Family Physicians of Canada,
are adopting social intranets to collaborate inside their organization.
Bye bye filing cabinets and shared folders.
The organizations mentioned
above stay organized with hierarchical storage of documents with unlimited folders, inline preview
and full version control. Organizations and associations in the
healthcare industry now have the power to stay connected to other healthcare
professionals, practitioners and patients in a secure environment where
confidential information is safe.
For more information, visit http://www.igloosoftware.com/blogs/inside-igloo/continuingtheconversationoutsidethedoctorsoffice4waystostayconnected
Editor's note: This blog is written by Anthony J. Hall, RN, BSN,
behavioral health charge nurse at Atlanta Medical Center.
The Affordable Care Act (ACA) means major changes in the way
Americans view health issues and treatment options. While there is increased
optimism building around the plan's effect on patient care, healthcare
providers will bear the burden of the plan's negative impacts, such as a
shortage of primary care providers. Though the full impact on the medical
profession has been hard to gauge, providers can be primed for some positive
adjustments as a result of ACA.
It's easy to see the immediate benefits of the ACA for healthcare
recipients - many more families will be able to schedule regular visits to a
general practitioner or family clinic, meaning more check-ups and preventative
For healthcare professionals, this increased patient load means
more providers will be needed; some will gain traction in positions of greater
authority as those with less experience are hired. The shortage of primary care
physicians will mean increased access to nurse practitioners (NPs) and
physician assistants (PAs), allowing localized healthcare to more patients, making
it unnecessary to travel to distant hospitals.
The increased presence of non-physician providers such as
laboratory professionals, respiratory technicians, NPs and PAs in
decision-making positions will bring a heightened awareness and a sense of
respect that has been long overdue. In my work with patients and the general
public, I've encountered many people who are uncertain of the role these
professionals play; by virtue of increased demand, more patients will become
aware of our importance in healthcare.
While many hospital systems are consolidating, combining forces
and units to avoid producing duplicate services, job cuts in the hospital sector
will provide an upswing in business for small practices, family clinics and
general practitioners. This change is likely to mean an increase in employment
for providers in all areas of specialization.
If you are interested in submitting to the Politics of Healthcare
blog, please contact Kelly Wolfgang at firstname.lastname@example.org.
Editor's note: This blog is written by Miguel
A. Bustillos, department chair and professor at California University of
Management & Sciences in Virginia.
us have heard about the Medicaid expansion and how states like Florida, Texas
and Virginia are against it. Some do not understand why the Medicaid expansion
has become such a big issue or what exactly the Medicaid expansion is.
Medicaid expansion, expected to be fully implemented by 2014, is a plan under the
Patient Protection and Affordable Care Act (PPACA) to expand medical coverage
for a number of people who do not qualify under the current plan. The Medicaid expansion
mandates that a state must meet PPACA standards to receive full federal funding,
which is needed to increase the current plan. The largest problem involving the
mandate is how states will cover the "new eligibles," those patients who are
receiving Medicaid assistance for the first time. It is estimated that 15.9
million new enrollees will participate in the plan by 2019.
federal government currently pays, on average, about 57% of the total cost of
Medicaid enrollees in each state. Of those that qualify for Medicaid, only 62%
have signed up for Medicaid benefits, leaving the remaining 38% without benefits.
Generally, those that are not taking the benefit either don't know that they
qualify or refused the benefit.
were to accept the Medicaid expansion, they would continue to pay for the
benefits of the 62% that are currently covered; in addition, they will have to
cover the 38% that qualified under the previous requirement, but did not take
the benefit. According to the new mandate, states must also provide for the new
the Medicaid expansion mandate, the federal government will continue to pay the
cost for about 57% of the 62% that are currently taking the benefit. With the
new law, the 38% that did not receive benefits will now either take the benefit
or pay a tax penalty. Some states believe that those who are qualified will
take the benefit rather than pay the penalty. Despite the "new enrollee" status
of those patients, the government will not support funding for any persons who
previously qualified but did not receive benefits.
regards to the true new eligible, the states believe that the cost of providing
Medicaid is just too large for any state to handle. To lessen the burden, the federal government has
penned an agreement to cover 93% of the cost of the true "new enrollees" till
the year 2020.
will decline to take on the Medicaid expansion because it's a voluntary program.
The new law can be very taxing to any state's budget and in most cases, there
are not enough incentives for states to adapt the program.
federal government is, however, not worried. When Medicaid was first signed
into law in 1965, only six states agreed to participate. But by 1982, every
state had joined. As 2014 comes along, and the law comes into full effect, it
will be interesting to see what develops and what does not. With the cost of
providing healthcare to so many people being so high, and the fact that
Medicare benefits will be cut to fund the Medicaid expansion, I foresee much
resistance on its implementation.
reported on Newswise, the
following is a statement by Jo Ivey Boufford, MD, president of The New York
Academy of Medicine, one of the nation's oldest and most prestigious medical
academies, on the seriousness of gun violence as a major public health issue.
The statement is in response to deadly incidents of gun violence in Newtown,
CT, Webster, NY, and the shooting of 15 individuals, three of whom died, during
separate acts of gun violence in Chicago, IL on New Year's Day.
"As a nation, we can only improve the health of the
public when we get our priorities straight. Recent acts of gun violence in
Chicago, Webster, NY, and Newtown, CT cannot be ignored. Neither can the 31,000
Americans who die each year at the hands of a gun. This number exceeds the
number of babies who die each year during their first year of life (25,000) or
people who die from AIDS (9,500) or illicit drugs (17,000).
institute protective measures enforcing speed limits and requiring the use of
safety belts; we implement public health measures such as child vaccinations
and regulations around the safety of food, drugs, and products. Yet guns escape
this type of regulation despite their significant contribution to the mortality
rate each year. We must view gun violence as a serious threat to the public's
health if we want to reduce the number of deaths associated with guns.
can start by banning the sale of assault rifles, high-capacity magazines, and
other facilitators of mass murder. And we must allow government agencies like
the Centers for Disease Control and Prevention to fully exercise their duties
in both surveillance of the incidence and impact of gun violence, and in
educating the public on steps for preventing death and injury through the use
evidence is clear, and we must now take action to protect our neighbors and
ourselves from this devastating public health crisis."
the American Nurses Association and the American College of Emergency
Physicians, two prominent and national healthcare organizations, issued calls
for a ban on the sale of assault weapons.
publication ADVANCE for Nurse Practitioners & Physician Assistants
asked its readers, "Do you think it is the responsibility of healthcare provider
organizations to urge this type of action?"
some readers had to say:
- "We can
all do our part. As nurses, as humans." - Teanne
stand in a trauma unit for one night and come back and give me your
answer." - Melissa
Absolutely! It's everyone's responsibility to speak up for what they
believe!" - Kelli
not. I have stood in the trauma unit for 15 years and taking away my legal
guns, which I carry concealed because I am licensed to do so, and taking
away my rifles, which I enjoy shooting responsibly, will do nothing to
stop the common street thug with an illegal weapon, other than allow me no
protection for myself and my property when I'm leaving the trauma unit at
midnight, sitting at a red light, and getting jacked by said thug." -
of our ER staff is armed; we see what's out there. As the Boy Scouts say,
be prepared. The bad guys will always find guns; we need to be able to
defend ourselves." - Diana
Prior trauma nurse here at Miami Dade County. Some individuals have no
business having weapons. Period." - Teresa
is definitely not the responsibility of healthcare provider organizations.
This is a civil liberty. I'm sure many members of the groups do not
support a ban. These groups should focus on healthcare issues." -
mental illness awareness and research would be a wiser choice! Let's be
honest, what health professional has not taken some form of weapon to work
with them?" - Susan
you agree with Boufford's statement and the calls for action by the American
Nurses Association and the American College of Emergency Physicians? Weigh in
on the comments below.
Editor's note: We welcome your comments and
topic suggestions; contact blog author Kelly Wolfgang at
Much of the extra medical costs come from prescription drugs and outpatient care, according to CDC study.
Young people with diabetes face substantially higher medical costs than children and teens without the disease, according to a Centers for Disease Control and Prevention (CDC) study published in the May issue of the journal Diabetes Care. The study found annual medical expenses for youth with diabetes are $9,061, compared to $1,468 for youth without the disease.
Much of the extra medical costs come from prescription drugs and outpatient care, CDC reported. Young people with the highest medical costs were treated with insulin, and included all those with type 1 diabetes and some with type 2 diabetes. People with type 1 diabetes cannot make insulin and must receive insulin treatment. Some people with type 2 diabetes also are treated with insulin, because their bodies do not produce enough insulin to control blood glucose (sugar).
Children and adolescents who received insulin treatment had annual medical costs of $9,333, compared to $5,683 for those who did not receive insulin, but did take oral medications to control blood glucose, the report stated.
"Young people with diabetes face medical costs that are six times higher than their peers without diabetes," said Ann Albright, PhD, RD, director of CDC's Division of Diabetes Translation. "Most youth with diabetes need insulin to survive and the medical costs for young people on insulin [are] almost 65 percent higher than for those who [do] not require insulin to treat their diabetes."
The study examined medical costs for children and teens aged 19 years or younger who were covered by employer-sponsored private health insurance plans in 2007, using the MarketScan Commercial Claims and Encounters Database. The estimates were based on administrative claim data from nearly 50,000 youth, including 8,226 with diabetes.
Medical costs for people with diabetes, the vast majority of whom are adults, are 2.3 times higher than costs for those without diabetes, according to CDC's National Diabetes Fact Sheet, 2011. Authors of the Diabetes Care study suggest that the difference in medical costs associated with diabetes may be greater for youth than for adults because of higher medication expenses, visits to specialists and medical supplies such as insulin syringes and glucose testing strips.
Among youth with diabetes, 92 percent were on insulin, compared to 26 percent of adults with diabetes. Without adequate insulin, blood glucose levels rise and can eventually lead to serious health complications, including heart disease, kidney failure, blindness, nerve damage and amputation of feet and legs.
Fifty-one percent of the nation's largest companies offered workers a CDHP model last year.
Enrollment in consumer-directed health plans (CDHPs) grew by 22 percent in 2010, up from 23 million in 2009 to 28 million last year, according to an analysis of the Mercer National Survey of Employer Sponsored Health Plans commissioned by the American Association of Preferred Provider Organizations (AAPPO).
While PPO enrollment has remained steady at 69 percent since 2008, CDHPs, which provide consumers more control over the cost of their health care, were the only type of plan to show enrollment growth, from 7 in 2008 to 11 percent in 2010, according to the survey. This trend corresponds with a slight, but steady decline in HMOs over that same period.
"Last year's continued economic slowdown combined with the rising cost of health care forced employers of all sizes to seek innovative ways to reduce what they spend to cover their employees. Given the cost savings inherent in the consumer-directed model, it's clear that employers --- especially our largest ones --- are increasingly looking to CDHPs to do that," said Karen Greenrose, AAPPO president and CEO.
"From the numbers that have been released, it is apparent that CDHPS are filling both a need and a void in the marketplace," said Tennessee Representative and House Energy and Commerce Health Subcommittee Member Marsha Blackburn. "Consumers want greater control over their health care decisions and they want it at a more affordable and manageable cost."
While the survey showed that employers of all sizes increased their CDHP offerings, very large employers -- companies with more than 20,000 employees -- were the major driver of the rise in CDHP offerings in 2010. Fifty-one (51) percent of the nation's largest companies offered their employees a CDHP model compared with just 43 percent in 2009. The percentage of small employers (10 - 499 employees) offering a CDHP model increased from nine to 15 percent.
Employers of all sizes surveyed expect to increase their CDHP offerings in the future, pointing to the likelihood that this trend of growth will continue in the years to come.
Click here to view the entire study.
Network of centers will give researchers access to new technologies and resources.
The National Institutes of Health (NIH) announced on April 26 that it has provided approximately $30 million over a five-year period to fund a network of centers to advance medical rehabilitation research. The centers provide researchers with access to new technologies and resources.
The centers are located at Stanford University; Children's National Medical Center in Washington, D.C.; University of California, San Diego; University of Texas Medical Branch in Galveston; Boston University; Rehabilitation Institute of Chicago; and Dartmouth College and Simbex, Inc. in New Hampshire.
The Medical Rehabilitation Research Network connects the research community with courses and workshops, research facilities, mentorship/consultations and experts at the network centers. The network also provides researchers with small grants to test new ideas.
The aim of rehabilitation research, according to NIH, is to promote recovery, adaptation and functioning for patients with disabilities resulting from stroke, spinal cord injury or brain injury, developmental or degenerative disorders, or other persistent physical conditions.
The new network provides researchers with access to expertise in such areas as:
- computer simulations for understanding movement disorders and evaluating how potential interventions might affect those movements;
- techniques for analyzing of how genes and molecules influence the recovery process;
- technologies for studying muscle action and function;
- assistance in tracking how well treatments meet the needs of patients;
- expertise in analyzing population data to evaluate the broader impact of rehabilitative treatments and health services;
- robots and sensors that assist patients and help deliver therapeutic treatments; and
- assessment of new rehabilitation technologies and assistance in bringing new therapeutic devices to the marketplace.
"The idea behind the network is to extend the reach of medical rehabilitation researchers by providing access to a broader array of research tools and approaches," said Ralph M. Nitkin, program director for Biological Sciences and Career Development Program in the National Center for Medical Rehabilitation Research (NCMRR).
The NCMRR is located within the Eunice Kennedy Shriver National Institute of Child Health and Human Development (NICHD), which provides funding for the network along with two other NIH Institutes, the National Institute of Neurological Disorders and Stroke and the National Institute of Biomedical Imaging and Bioengineering.
During the first year of funding, the network has supported a variety of pilot projects including studies of:
- sensors in muscles to help amputees control prosthetic devices;
- treatment of muscle spasms in spinal cord injury patients and promoting muscle function in patients with amyotrophic lateral sclerosis;
- integration of people with disabilities into the community, especially involving behavioral or mental conditions such as post traumatic stress disorder;
- promoting walking in children with cerebral palsy;
- therapy for patients with degenerative muscle disorders or severe muscle injury;
- devices for preventing falls in the elderly;
- monitoring blood flow in the brain as a way to follow how specific brain regions respond to therapeutic treatments;
- assessing bone loss, bladder function and nervous system changes in patients with spinal cord injury;
- understanding the impact of cancer treatments on individual health and function; and
- studies of jaw function and long-term pain complications in animal models.
NIH, a component of the U.S. Department of Health & Human Services, is the primary federal agency conducting and supporting basic, clinical and translational medical research, and is investigating the causes, treatments and cures for both common and rare diseases.
Published study finds that people in minority groups prefer to extend life as much as possible, even if it means using all financial resources.
People in minority groups, especially black Americans, are more willing than their white counterparts to exhaust their personal financial resources to prolong life after being diagnosed with lung or colorectal cancer, according to a University of Alabama at Birmingham (UAB) study published April 26 in the online edition of Cancer, the journal of the American Cancer Society.
Lead author Michelle Martin, PhD, assistant professor in the UAB Division of Preventive Medicine and a scientist with the UAB Comprehensive Cancer Center, and her colleagues compared the willingness of 4,214 participants in a multi-center observational study of patients with newly diagnosed lung or colorectal cancer to use their personal financial resources to extend their lives.
Among other questions, patients were asked, "If you had to make a choice now, would you prefer treatment that extends life as much as possible, even if it means using all of your financial resources, or would you want treatment that costs you less, even if it means not living as long?"
The researchers found that 80 percent of blacks were willing to spend all of their personal finances to extend life, while 54 percent of whites, 69 percent of Hispanics and 72 percent of Asians were willing to do so.
After accounting for a number of factors, including income, disease stage, quality of life, age, perceived time left to live and other medical illnesses, blacks were 2.4 times more likely to expend all personal financial resources to extend life than whites, according to the study. Hispanic patients were 1.45 times more likely and Asian patients were 1.59 times more likely to expend all personal financial resources than white patients.
The availability of insurance had no statistical effect on the results, by race, the researchers reported.
Several other factors were independently associated with a decreased willingness to exhaust finances to extend life, Dr. Martin said, especially age, family size and social support.
Single, divorced or separated people were more willing to spend all their financial resources than people who were married or living with a partner. People who did not know their life expectancy or who believed their life expectancy was "in God's hands" were more willing to spend than whose life expectancy was considered five years or less.
Dr. Martin said the study did not provide concrete reasoning for the differences, but its findings create a basis for future studies.
"The next step is to obtain an in-depth understanding of the factors that influence treatment preferences," she added. "Future work could broaden the factors that we examine, and time spent with cancer patients in conversation about their experience and treatment preferences will help us better deliver cancer care that reflects those."
Rule would apply to more than 1,200 Medicare participating facilities.
On April 22, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that would update Medicare payment policies and rates for inpatient rehabilitation facilities (IRFs) in fiscal year (FY) 2012. The rule proposes to increase payment rates under the IRF Prospective Payment System (PPS) by 1.5 percent -- an estimated $120 million nationwide.
According to CMS, the projected update reflects a "rebased and revised market basket" specific to IRFs, inpatient psychiatric facilities, and long-term care hospitals (the RPL market basket) -- currently estimated at 2.8 percent for FY 2012 -- less a 1.3 percentage point reduction mandated by the Affordable Care Act.
The proposed rule, which would apply to more than 1,200 Medicare-participating IRFs, including approximately 200 freestanding IRFs and approximately 1,000 IRF units in acute care hospitals and critical access hospitals, seeks to establish a new quality reporting system authorized by the Affordable Care Act.
"The proposed rule would extend Medicare's ongoing efforts to use its payments to encourage better care for beneficiaries who are treated in inpatient rehabilitation facilities," said CMS Administrator Donald Berwick, MD. "The measures IRFs would report under the proposed rule will pave the way for Medicare to work with IRFs to improve patient safety, prevent patients from picking up new illnesses during a hospitalization, and provide well-coordinated person- and-family-centered care."
CMS said the proposed quality reporting system is aligned with the goals of the Partnership for Patients, a new public-private partnership aimed at improving the quality, safety and affordability of health care. Initially, IRFs would submit data on two quality measures: (1) urinary catheter-associated urinary tract infection and (2) pressure ulcers that are new or have worsened. These are two of the nine conditions the Partnership has identified as important places to initiate efforts to reduce harms to patients. A third measure currently under development (discussed as a potential measure for future rulemaking cycles) would address readmissions within 30 days to another inpatient stay, whether in an acute care hospital, rehabilitation facility or other setting.
Payments would be reduced by two percentage points beginning in FY 2014 for IRFs that do not submit quality data. CMS said it anticipates adding measures for reporting in the future through rulemaking. CMS also plans to establish a process for making the measures data available to the public. As with other data published on the CMS website, IRFs choosing to report quality data would have an opportunity to review the data for accuracy before it became public.
CMS will accept comments on the proposed rule until June 21, 2011, and will address all comments in a final rule to be issued by Aug. 1, 2011.
Click here to review the proposed rule.
Grants totaling $1 million go to research studies at Baylor College of Medicine; Massachusetts General Hospital; the University of California, San Francisco; and the University of Florida.
The Aetna Foundation announced on April 20 that it will fund four research projects intended to assess new health care delivery designs that promote integrated health and patient-centered medical homes.
The Aetna Foundation made grants totaling $1 million to separate studies by Baylor College of Medicine; Massachusetts General Hospital; the University of California, San Francisco; and the University of Florida.
"Many of the highest-performing health care providers achieve great outcomes by offering well-integrated health care and serving as a medical home for patients," said Anne C. Beal, MD, MPH, president of the Aetna Foundation, who has published widely on health care issues. "The most effective primary care providers manage and coordinate care from specialists, therapists, hospitals and other providers, which ensures good communication among all parties and keeps the patient involved and informed. This coordination role is especially important for patients with chronic or complex health conditions, since most of their health care is managed by primary care providers."
Dr. Beal continued, "While we know that well-integrated and well-coordinated care can have a host of benefits -- improved health outcomes, better patient experiences, lower costs and fewer medical errors -- we do not fully understand the links between good coordination and good outcomes nor have we identified the best pathways to achieving strong care coordination. We believe the studies we are supporting can help bring forth models of integrated health care that will lead to healthier patients and lower costs."
The four research grants are:
- $250,000 to Baylor College of Medicine in Houston to study how primary care medical homes can lower the cost of care and improve the health of children with chronic physical, developmental or behavioral conditions. Upwards of 16 percent of American children are estimated to have special health care needs, and their care accounts for 42 percent of medical expenditures on children in the United States. Using Medicaid/Children's Health Insurance Program data for Houston-area children, the researchers will identify a diverse group of children with special health care needs and survey their doctors about the children's treatment and coordination of their care. To obtain the patient perspective, the researchers will survey the children's parents about their satisfaction with their youngster's care. Additionally, the researchers will analyze claims data to see if the children treated by doctors who identify their practice as a primary care medical home have fewer emergency room visits, hospitalizations and other potentially avoidable treatments than children who receive their care from other types of medical practices.
- $250,000 to Massachusetts General Hospital in Boston to study whether intensive care management and integrated care can improve the health outcomes of economically disadvantaged patients with multiple chronic conditions while decreasing the cost of their treatment. The research team will evaluate a new integrated primary care program launched in 2010 by Cambridge Health Alliance that serves a diverse population of low-income children and adults with two or more chronic conditions. The Massachusetts-based program assigns each patient to a primary care doctor who coordinates treatment, and, as needed, adds an interdisciplinary team of nurse practitioners, clinical nurse psychologists, social workers and community health workers to help patients manage their health. The two-year study will examine the barriers in implementing the program, assess patient satisfaction with the program's care coordination, communication and quality, and quantify the cost of care.
- $250,000 to the University of California, San Francisco for a two-year study to create a survey tool to assess integrated care around the country. The research will be among the first to develop metrics of integrated care based on the needs, experiences and expectations of patients with chronic conditions. By focusing on the patient experience to create measurements of integrated care practices, the researchers expect their measurement tools to assess these concepts more systematically among diverse patient populations and in a wide range of practice settings.
- $250,000 to the University of Florida in Gainesville for a two-year study exploring whether primary care medical homes can improve the health of patients with diabetes. Currently, 24 million Americans are living with diabetes, a chronic disease that requires patients to take an active role in monitoring their diet and glucose levels to manage the disease successfully. The researchers will examine if the primary care medical home model increases patient engagement with managing their diabetes and if increased patient engagement leads to better health. Four Jacksonville, Fla., patient-centered medical home practices, each serving a racially and socio-economically diverse population, will be the sites of the research.
Integrated care is one of the Aetna Foundation's three program areas, along with fighting obesity and promoting racial and ethnic equity in health and health care. Since 1980, Aetna and the Aetna Foundation have contributed $394 million in grants and sponsorships, including $15.6 million in 2010.
Aon Hewitt report says 61 percent of surveyed companies to evaluate long-term retiree medical programs by end of 2011.
Most large employers are beginning to rethink their retiree health care strategy as a result of federal health care reform, according to a recent report released by Aon Hewitt, the human resource consulting and outsourcing business of Aon Corporation.
In late 2010, Aon Hewitt surveyed 344 companies, representing 2.2 million retirees nationwide, and found that 61 percent were either already evaluating or were expected to evaluate their long-term retiree medical strategy by the end of 2011, due to health care reform. Meanwhile, 23 percent of respondents indicated they were still considering whether to assess their current strategy and only 16 percent had no immediate plans to review their current approach.
"Health care reform creates both challenges and opportunities for employers sponsoring retiree medical programs," said John Grosso, retiree health care group leader with Aon Hewitt. "Most employers have been studying the new legislation to understand how to effectively manage the challenges, while taking full advantage of the new opportunities going forward. Many will find that the new legislation will create significant and immediate savings opportunities."
Most immediately, among those planning to apply for the temporary Early Retiree Reinsurance Program (ERRP) to help offset a portion of the cost of health claims for retirees age 55 to 64, about half of respondents (48 percent) anticipate using the proceeds to reduce premiums, including both employer and participant share, while 21 percent intend to reduce the employer share of premiums only.
As for companies in the survey that pay a portion of health coverage for their retirees age 65 or older, three-quarters currently collect the Retiree Drug Subsidy (RDS). Of those, 73 percent said they are altering their retiree drug benefits strategy, as health reform eliminates the RDS tax advantages for 2013, and creates enhancements to the Medicare Part D program for retiree drug benefits beginning in 2011. In fact, 61 percent anticipate announcing these changes by the end of 2011 in order to begin recognizing accounting savings quickly, while 86 percent expect to actually implement these changes by 2013, the survey report stated.
Alternatives most favored by employers making or contemplating changes to their post-65 retiree medical programs include contracting with a Part D Prescription Drug Plan (34 percent) or moving to a pure defined-contribution approach (30 percent) where post-65 retirees can purchase benefits through the individual Medicare retiree plan market. Other employers support combining access to individual Part D plans with premium subsidization (5 percent) or out-of-pocket cost subsidization (5 percent). Another 9 percent prefer eliminating employer-sponsored retiree prescription drug benefits altogether.
Of the employers favoring contracting with a Part D Prescription Drug Plan on a group basis, 57 percent will look to utilize an "Employer Group Waiver Plan (EGWP) + Wrap" approach, whereby the employer contracts for a Standard Medicare Part D plan design with a wraparound benefit that attempts to preserve the current prescription drug plan design and formulary strategy for the retiree.
"Many employers are looking to access cost-reduction opportunities created by the new changes to the Part D program," said Grosso. "For those wanting to continue to manage and control their group program, contracting with a Medicare Part D plan on a group basis, leveraging the EGWP process will make sense. Conversely, for those looking to move away from a group-based model, individual market-based benefit sourcing, supported by some level of tax-effective defined-contribution funding, may be a desirable strategy."
In addition, Aon Hewitt's survey found that 36 percent of respondents plan to make changes to their pre-65 retiree benefits strategy to directly leverage the health insurance exchanges that states, or the federal government, are required to create in 2014. Twenty-one (21) percent prefer moving to a pure defined-contribution approach, where retirees could use an account established by the employer to purchase coverage through the exchanges. The balance of those employers anticipate eliminating pre-65 coverage in response to the creation of exchanges.
Milind Desai, retirement actuary with Aon Hewitt, commented, "Individual market benefit-sourcing, supported by state and private exchanges, can create cost-effective coverage opportunities for retirees that do not exist today, even within most employer-sponsored retiree group health plans. This is a primary reason why employer programs will evolve toward individual market-based benefit strategies over time."
Ties annual update amount to participation in Inpatient Quality Reporting Program, and supports efforts to lower costs.
On April 19, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that would update Medicare payment policies and rates for hospitals in fiscal year (FY) 2012. CMS said proposals included in the rule would help support the Obama administration's efforts to reform the U.S. health care delivery system by improving care quality and patient outcomes, addressing long-term health care cost growth and supporting the goals of the recently announced Partnership for Patients.
"The proposals CMS is making today reflect an underlying premise that we can improve the quality of and access to care while at the same time slowing the growth in health care spending," said CMS Administrator Donald Berwick, MD. "In fact, there is a growing body of evidence that improving care -- focusing on the patient's needs, reducing unnecessary duplicate services, and avoiding costly mistakes and preventable healthcare-acquired conditions -- is key to reducing health care cost growth."
The proposed rule would update payment policies and rates for acute care hospitals paid under the Inpatient Prospective Payment System (IPPS), as well as hospitals paid under the Long Term Care Hospital Prospective Payment System (LTCH PPS). According to CMS, the proposed rule would also improve and expand the Hospital Inpatient Quality Reporting Program (IQR) with a greater focus on patient outcomes and experiences of care and establish the framework for a new quality reporting program that would apply to hospitals paid under the LTCH PPS.
The proposed rule includes several quality improvement proposals that will support larger quality and patient safety efforts across the Department of Health & Human Services, including the Partnership for Patients, a public-private partnership that will help improve the quality, safety and affordability of health care for Medicare, Medicaid and CHIP beneficiaries. One of the Partnership's goals is to decrease preventable complications during a transition from one care setting to another so that all hospital readmissions would be reduced by 20-percent by 2014 compared to 2010.
Research by the Medicare Payment Advisory Commission (MedPAC) and others show that as many as 1 in 3 Medicare patients who leave the hospital will be readmitted within 30 days of discharge, and that a large portion of these readmissions can be avoided through well-coordinated, high-quality hospital care. To provide hospitals with an incentive to improve care coordination, the Affordable Care Act directs CMS to implement a Hospital Readmissions Reduction Program that will reduce payments beginning in FY 2013 to certain hospitals that have excess readmissions for certain selected conditions. The proposed rule released April 19 proposes measures for rates of readmissions for three conditions -- acute myocardial infarction (or heart attack), heart failure and pneumonia. CMS also proposes a methodology that would be used to calculate excess readmission rates for the program. Additional conditions may be added in future rulemaking, CMS noted. The payment adjustments will apply to hospital payments in FY 2013, beginning with discharges on or after Oct. 1, 2012.
The proposed rule also includes proposals aimed at encouraging improvements in the quality of care in hospital inpatient settings, and makes proposals that would align the existing inpatient quality reporting program with a proposed new hospital value-based purchasing program required by the Affordable Care Act. The proposed rule also lays the groundwork for a quality reporting program under the LTCH PPS, by proposing the first measure set for reporting in FY 2013, for payment determination in FY 2014, and discusses specific quality considerations for hospitals providing acute-level care to patients requiring longer stays. To be paid under the LTCH PPS, a hospital must have an average length of stay for all patients it treats that exceeds 25 days.
CMS said the proposed rule, which would apply to approximately 3,400 acute care hospitals and approximately 420 LTCHs, would be effective for discharges occurring on or after Oct. 1, 2011. Under the proposed rule, CMS projects that Medicare operating payments to acute care hospitals for discharges occurring in FY 2012 will decrease by an estimated $498 million or 0.5 percent in FY 2012 relative to FY 2011.
The Medicare law requires CMS to pay acute care hospitals (with a few specified exceptions) for inpatient stays under the IPPS and long-term care hospitals under the LTCH PPS. These payment systems establish prospectively set rates based on the patient's diagnosis and the severity of the patient's medical condition. Under the IPPS and the LTCH PPS, a hospital receives a single payment for a case based on the payment classification assigned at discharge. The law requires CMS to update the payment rates for both types of hospitals annually to account for changes in the costs of goods and services used by these hospitals in treating Medicare patients, as well as for other factors.
Click here to access the proposed rule.
NIH-supported revision also proposes staging of disease, potential use of biomarkers.
On April 19, the National Institutes of Health (NIH) announced the release of revised clinical diagnostic criteria for Alzheimer's disease dementia. NIH also reported that research guidelines for earlier stages of the disease have been characterized to reflect a deeper understanding of the disorder. The diagnostic guidelines had not been updated since 1984. NIH and the Alzheimer's Association led development of the new guidelines.
"The National Institute on Aging/Alzheimer's Association Diagnostic Guidelines for Alzheimer's Disease outline some new approaches for clinicians and provides scientists with more advanced guidelines for moving forward with research on diagnosis and treatments," according to NIH. "They mark a major change in how experts think about and study Alzheimer's disease.
The original criteria were the first to address the disease and described only later stages, when symptoms of dementia are already evident. The updated guidelines announced April 19 cover the full spectrum of the disease as it gradually changes over many years. They describe the earliest preclinical stages of the disease, mild cognitive impairment, and dementia due to Alzheimer's pathology. NIH noted that the guidelines now address the use of imaging and biomarkers in blood and spinal fluid that may help determine whether changes in the brain and those in body fluids are due to Alzheimer's disease. Biomarkers are increasingly employed in the research setting to detect onset of the disease and to track progression, but cannot yet be used routinely in clinical diagnosis without further testing and validation, NIH added.
"Alzheimer's research has greatly evolved over the past quarter of a century. Bringing the diagnostic guidelines up to speed with those advances is both a necessary and rewarding effort that will benefit patients and accelerate the pace of research," said National Institute on Aging Director Richard J. Hodes, MD.
"We believe that the publication of these articles is a major milestone for the field," said William Thies, PhD, chief medical and scientific officer at the Alzheimer's Association. "Our vision is that this process will result in improved diagnosis and treatment of Alzheimer's, and will drive research that ultimately will enable us to detect and treat the disease earlier and more effectively. This would allow more people to live full, rich lives without -- or with a minimum of -- Alzheimer's symptoms."
The new guidelines appear online in Alzheimer's & Dementia: The Journal of the Alzheimer's Association. They were developed by expert panels convened last year by the National Institute on Aging (NIA), part of the NIH, and the Alzheimer's Association. Preliminary recommendations were announced at the Association's International Conference on Alzheimer's Disease in July 2010, followed by a comment period.
The original 1984 clinical criteria for Alzheimer's disease, reflecting the limited knowledge of the day, defined Alzheimer's as having a single stage, dementia, and based diagnosis solely on clinical symptoms. It assumed that people free of dementia symptoms were disease-free. Diagnosis was confirmed only at autopsy, when the hallmarks of the disease, abnormal amounts of amyloid proteins forming plaques and tau proteins forming tangles, were found in the brain.
Since then, research has determined that Alzheimer's may cause changes in the brain a decade or more before symptoms appear and that symptoms do not always directly relate to abnormal changes in the brain caused by Alzheimer's. For example, some older people are found to have abnormal levels of amyloid plaques in the brain at autopsy yet never showed signs of dementia during life. It also appears that amyloid deposits begin early in the disease process but that tangle formation and loss of neurons occur later and may accelerate just before clinical symptoms appear.
To reflect what has been learned, the NIA/Alzheimer's Association Diagnostic Guidelines for Alzheimer's Disease cover three distinct stages of Alzheimer's disease:
- Preclinical -- The preclinical stage, for which the guidelines only apply in a research setting, describes a phase in which brain changes, including amyloid buildup and other early nerve cell changes, may already be in process. At this point, significant clinical symptoms are not yet evident. In some people, amyloid buildup can be detected with positron emission tomography (PET) scans and cerebrospinal fluid (CSF) analysis, but it is unknown what the risk for progression to Alzheimer's dementia is for these individuals. However, use of these imaging and biomarker tests at this stage are recommended only for research. These biomarkers are still being developed and standardized and are not ready for use by clinicians in general practice.
- Mild Cognitive Impairment (MCI) -- The guidelines for the MCI stage are also largely for research, although they clarify existing guidelines for MCI for use in a clinical setting. The MCI stage is marked by symptoms of memory problems, enough to be noticed and measured, but not compromising a person's independence. People with MCI may or may not progress to Alzheimer's dementia. Researchers will particularly focus on standardizing biomarkers for amyloid and for other possible signs of injury to the brain. Currently, biomarkers include elevated levels of tau or decreased levels of beta-amyloid in the CSF, reduced glucose uptake in the brain as determined by PET, and atrophy of certain areas of the brain as seen with structural magnetic resonance imaging (MRI). These tests will be used primarily by researchers, but may be applied in specialized clinical settings to supplement standard clinical tests to help determine possible causes of MCI symptoms.
- Alzheimer's Dementia -- These criteria apply to the final stage of the disease, and are most relevant for doctors and patients. They outline ways clinicians should approach evaluating causes and progression of cognitive decline. The guidelines also expand the concept of Alzheimer's dementia beyond memory loss as its most central characteristic. A decline in other aspects of cognition, such as word-finding, vision/spatial issues, and impaired reasoning or judgment may be the first symptom to be noticed. At this stage, biomarker test results may be used in some cases to increase or decrease the level of certainty about a diagnosis of Alzheimer's dementia and to distinguish Alzheimer's dementia from other dementias, even as the validity of such tests is still under study for application and value in everyday clinical practice.
NIH said the panels purposefully left the guidelines flexible to allow for changes that could come from emerging technologies and advances in understanding of biomarkers and the disease process itself.
"The guidelines discuss biomarkers currently known, and mention others that may have future applications," said Creighton H. Phelps, PhD, of the NIA Alzheimer's Disease Centers Program. "With researchers worldwide striving to develop, validate and standardize the application of biomarkers at every stage of Alzheimer's disease, we devised a framework flexible enough to incorporate new findings."
Funding for as much as $500,000 per grant will be available for up to three years.
The Substance Abuse and Mental Health Services Administration (SAMHSA) announced on April 14 that it is accepting grants for programs that help persons who experience chronic homelessness achieve sustainable permanent housing and receive other important services.
SAMHSA said it expects up to $6.58 million to be available for up to 14 grants of as much as $500,000 per grant for up to three years. Domestic public and private nonprofit entities are eligible to apply for grant funding. The agency noted that award amounts may vary, depending on the availability of funds and the progress achieved by the awardees.
According to SAMHSA, the purpose of the Cooperative Agreements to Benefit Homeless Individuals program is to "support the development and/or expansion of local implementation and community infrastructures that integrate treatment and services for mental and substance use disorders, permanent housing, and other critical services for individuals who are chronically homeless."
SAMHSA seeks to increase the placement of individuals who are chronically homeless in permanent housing that supports recovery through comprehensive treatment and recovery services for behavioral health. SAMHSA also seeks to increase capacity for community-based providers to enroll individuals who are chronically homeless in mainstream programs and obtain reimbursement for behavioral health.
Grant applications are due May 27. Click here to access the application form. SAMHSA recommends that applicants carefully review Section IV-3 for submission requirements.